After failed acquisition talks and years of cost-cutting, the edtech firm leans on franchising to salvage offline ops and reclaim stability.
Unacademy’s Latest Reset: What’s Really Driving the Pivot?
Just nine months ago, Unacademy CEO Gaurav Munjal claimed nearly 70% of the company’s offline centres would become profitable by year-end. That optimism has now been replaced by pragmatism. In a January 2026 internal email, Munjal announced Unacademy’s shift to a franchise model, handing day-to-day operations to local partners while the company supplies content, tech, and brand value.
- The move is set for completion by April 2026.
- Unacademy aims to stay asset-light and capital-efficient.
So why the sudden change? Context is key. This pivot comes just weeks after Unacademy’s acquisition talks with upGrad collapsed, reportedly over valuation differences. Rather than an evolution, this appears to be a strategic retreat — a cost-containment maneuver shaped by failed external rescue attempts.
Is franchising Unacademy’s way to stay relevant without bleeding cash?
Years of Cutbacks, Layoffs, and Shrinking Ambitions
At its peak, Unacademy was India’s second most valuable edtech startup, commanding a $3.5B valuation. But after the 2022 funding winter and the end of the pandemic-fueled edtech boom, the company went into survival mode:
- Losses dropped to INR 435 Cr in FY25 from INR 1,678 Cr in FY23.
- Operating revenue fell to INR 701 Cr in FY25 from INR 907 Cr in FY23.
- Platforms like Relevel were shut down entirely.
In a 2025 post on X, Munjal vowed to slash cash burn to under INR 200 Cr — a massive drop from the INR 1,000+ Cr annual burn three years prior. But growth has stalled.
Worse, the leadership exodus has been relentless:
- Cofounder Hemesh Singh, and COOs Vivek Sinha and Jagnoor Singh exited.
- Six senior leaders, including CFO and franchise head, departed between 2023 and 2025.
Can a company reinvent itself when its original architects have left the building?
The Endless, Fruitless Search for a Buyer
With capital drying up, Unacademy has been quietly shopping itself since 2023. Talks with BYJU’S-owned Aakash, Allen Career Institute, PhysicsWallah, and K-12 Techno Services all fizzled.
Even the most recent negotiation with upGrad, which finally saw Munjal publicly acknowledge a potential sale, failed to close. Despite Unacademy’s reported $300–$400M ask — nearly 90% below peak valuation — buyers weren’t biting.
With no white knight in sight, Unacademy is now turning inward.
- No acquirer. No merger. No bailout.
- Just a pivot — and possibly, a final attempt to control the narrative.
Will franchising be enough to convince investors Unacademy is worth another shot?
Returning to Online Roots — But Can It Scale?
Unacademy began as a YouTube channel in 2015, built around K-12 and test prep. The offline push started in 2022 to offset slowing online growth. By 2024, offline centres made up 40% of the company’s revenue — but carried massive costs in real estate, faculty, and marketing.
Competitors like PhysicsWallah undercut pricing, while FIITJEE, Allen, and Aakash struggled with poor offline economics. Unacademy’s franchise move lets it retain presence without operational overhead.
Munjal now says core test prep categories like UPSC, NEET PG, and CAT have turned contribution-margin positive. PrepLadder and Graphy are also reportedly cash-flow positive.
But what’s the cost of this retrenchment — and is it enough?
The Airlearn Wild Card: A Bet on Language Learning
Munjal’s new moonshot is Airlearn, a Duolingo-style language learning app. According to him, ARR grew from $200K to $3M in 2025 — impressive on paper. However, with AI-driven tools flooding the space and even Duolingo facing valuation hits, timing may not be on Airlearn’s side.
- Airlearn may spin off, requiring separate capital.
- The market, though, is skeptical of edtech spinoffs in 2026.
Can Unacademy afford to gamble on a new vertical while its core model is still in flux?
A Company Still Searching for Its Post-Pandemic Identity
Unacademy’s latest playbook — franchise offline, focus online, bet selectively — reflects a company still chasing equilibrium in a saturated, capital-scarce edtech market. Every pivot since 2022 has come with trade-offs: lower burn, but weaker topline; less ownership, but more survivability.
What Unacademy needs now isn’t just a new model — it needs conviction, leadership depth, and long-term investor faith.
And maybe, finally, a plan that sticks.
TL;DR
Unacademy is pivoting to a franchise model for its offline centres after failed acquisition talks with upGrad. The move follows years of cost cuts, leadership exits, and missed M&A opportunities. While its online test prep is stabilising, the future hinges on Airlearn and whether franchising can revive its offline strategy.
AI summary
- Unacademy to franchise its offline centres by April 2026
- Shift follows failed acquisition talks with upGrad
- FY25 losses down to INR 435 Cr, revenue also fell
- Key senior exits, including cofounder and CFO
- Betting on Airlearn after pivoting back to online-first strategy
